Bill Cossitt

What Are Housing Starts?

A housing start is recorded when construction begins on a new residential unit. Housing starts can include single-detached homes, townhomes, condominiums, apartments and other types of residential construction. Housing starts are closely watched because they provide an indication of how much new housing may eventually become available.

Do Fewer Housing Starts Mean Home Prices Will Rise?

Not necessarily, and certainly not automatically. Home prices depend on both supply and demand. Fewer new homes can create upward pressure on prices when there are many buyers competing for limited inventory. But if buyer demand is also weak, slower construction does not automatically translate into higher prices.

Could Slower Construction Affect Home Affordability?

Over the longer term, housing supply is an important part of affordability. When housing construction fails to keep pace with household demand over an extended period, buyers and renters can face greater competition for available homes. CMHC continues to identify housing affordability as a major challenge in Canada and has emphasized the importance of adding sufficient housing supply over time.

Will Slower Housing Starts Cause Mortgage Rates to Fall?

Slower home construction does not directly determine Canadian mortgage rates.

Should You Wait for Mortgage Rates to Fall Before Buying?

Trying to perfectly time both mortgage rates and home prices is extremely difficult. If mortgage rates decline in the future, borrowing costs may become more affordable. But improved affordability can also encourage more buyers to return to the market, potentially increasing competition for suitable homes.